When it comes to flipping houses, location is key. Many different factors go into exactly how much you’ll make on each property, with the city where the property is located serving as a major component.
Wondering where exactly the highest profits are to be had? ATTOM, a nationwide provider of property data, recently released its first-quarter 2023 U.S. Home Flipping Report, showcasing the cities with the highest profit margins for flippers.
- Average ROI for typical home flips: 84.6%
As of June 2023, the median home price in New Orleans is $361,000 — an 8.6% decline year-over-year — according to Redfin. In total, 358 homes were sold during the month, spending a median of 69 days on the market.
- Average ROI for typical home flips: 92%
On the rise, home prices in Shreveport grew 4.5% year-over-year in June 2023, according to Redfin. The 168 homes sold during the month closed at a median sale price of $207,000, after spending an average of 35 days on the market.
- Average ROI for typical home flips: 94.9%
Despite the high profit margin for flippers, home prices in Flint declined 12.5% in June 2023, with a median sale price of $63,000, according to Redfin. A total of 101 homes sold during the month, spending an average of just 21 days on the market.
- Average ROI for typical home flips: 109.8%
A slight increase, Pittsburgh home prices rose 1.9% year-over-year in June 2023, with a median price of $275,000, according to Redfin. The 530 homes sold during the month spent an average of 54 days on the market.
- Average ROI for typical home flips: 121.9%
It tops the list for house flippers, but in June 2023, Scranton home prices declined 5.5% year-over-year, according to Redfin. Impressively, the 64 homes sold during the month only lasted on the market for an average of seven days — with a median sales price of $156,000.
Nick Disney, owner of Sell My San Antonio House, based in Texas, said his team focuses on cities where there is a high demand for their end product, with 95% of his projects located in the city of San Antonio.
“San Antonio is one of the largest cities in the U.S., and there is always a high demand for a quality home at an affordable price,” he said.
He said they focus on houses that will be priced at under $300,000 post-flip, which allows them to always have a large buyer pool, so they can sell the property quickly.
“The faster we sell our houses, the more houses we can flip, and that leads to higher profits,” he said.
Look for a Large Buyer Pool — But Keep Costs Down
Also based in San Antonio, Texas, Danny Johnson, owner of Danny Buys Houses, said there are a couple different ways to look at profit differences between cities when flipping houses.
“While cities in California usually produce higher total profits than cities in the Midwest, they do not compare to the return on investment in less costly places,” he said. “I love real estate investing in San Antonio, Texas, because I can typically make great profit margins without huge outlays of money.”
When choosing which area to focus on buying properties to flip, Johnson said he looks for the largest buyer pool.
“For San Antonio, that is just over our current median home price of $288,000,” he said. “This is where there are more buyers.”
As a seasoned house flipper, he said it’s important to keep your holding costs down.
“Knowing where the largest demand is can help you keep days on market down,” he said. “The faster we sell, the more we make.”
Do Your Research
As for other cities house flippers are interested in, Gagan Saini, director of acquisitions at JiT Home Buyers, based in Metairie, Louisiana, said that Nashville, Tennessee and Austin, Texas have showing promising potential.
“These cities offer a combination of solid job markets, population growth and high demand for housing, which can contribute to higher profits,” he said.
Before purchasing a property, he said there are many different elements to keep in mind.
“As an investor, key factors to consider when choosing areas to buy houses for flipping include market trends, property prices, renovation costs, neighborhood desirability and potential resale value,” he said. “Thorough research, local market knowledge and working with a trusted real estate agent can help guide your investment decisions and increase your chances of success.”
There’s a lot of money to be had in flipping houses, so make careful decisions — including choosing the right location — and hopefully your next project will be a success.
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